mansion of arts and letters. beauty can be important in the person's life. and people beguiled by the beautiful are less dangerous to others than those sue pressed by the thought of supremacy. if an afternoon of reading poetry has given me a feeling of profound well being, i don't then need to go out into the street and seek satisfaction by strangling prostitutes. [laughter] >> art can be central in a person's life. if the art we create is beautiful enough, will people will so drawn to looking at it that they'll leave behind their quest for power. beauty really is more enjoyable than power. a poem really is more enjoyable
than an empire. because a poem doesn't hate you. the defense of privilege, the center of our lives, for such a long time is grim. it's exhausting. we're exhausted from holding on to things. exhausted from trying not to see those unobtrusive people we're kicking away. who's suffering is actually unwearable to us. in the mansion of our arts and letters, we live like children, running and playing, up and down the hallways all day and all night. we fill room after room with the things that we make. after our deaths, we'll leave behind our poems, drawings, and songs, made for our own pleasure. and we won't know if they'll be allowed to help in the making of
that you live now. >> well -- >> just for a point of reference. >> i grew up on the upper east side. i live in chelsey. >> i love the mansion of arts and letters. that's great. >> can you elaborate on what made up the sandwiches? >> no. [laughter] i mean that's. that's the sandwich we're all looking for. [laughter] >> i wanted to ask a question about something that i just recently read about something that you wrote. roger ebert wrote, he said the
only film that he knows of that has no cliches in it. did you see that? i was wondering what you thought about that comment? >> i didn't see that. but what an incredibly nice thing for him to say. well, you know, i mean -- it's -- this is the struggle of -- of -- well, this is what i would say is the point of having writers. because most conversation and most journalism is made up of cliches. where you are preanswering
really most of the important questions about whatever you're discussing. and i suppose writers are people who've been liberated from actual work. so that they can, you know, tune their ears up to a higher level of skill, devoting all way do it. and so that they can hear the cliches and try to rise above them. this is also sort of the essence of theater. because in theater or at least the good kind -- because actors
rehearse in order to see through the cliches of reputation that they start off with. in other words on the first day of rehearsal, you're interrations of what your character is up to is made up almost completely of cliches. and because our heads are made up almost completely of cliches. in the process of rehearsal, we see that the cliche that we thought was the only way of reading what the author wrote and what your line is, is actually not included in the line. and it is not really what the
author mention. >> having seen you in the scene, i get the the feeling that the essay is possibly connected to the search in the play. i'm wondering if that was, you probably wrote this some time ago. now we are seeing the economy as bad as it is, probably the widening of the gap between the poor and the rich. i'm wondering if you have any new ideas about this about one as an artist or writing can do in this situation. you're raising the questions. but you're not giving us a lot of answers. >> well, i suppose, you know, it isn't -- i don't think i could tell everybody here how they
should change the world. i mean but i would say, i think, you know, i'm someone who really began life as a senturist. someone who accepted the american democratic party as a mainstream of that type of thinking as an adequate analysis of the world. and i've, you know, moved to the left we would say. over the years. and come to come to -- i suppose be a '60s radical in my '60s or something.
-- in my 60s or something. [laughter] >> and i believe, you know, that people should be, you know, activist, really. to the extent that they are capable of it. putting, you know, -- putting as much pressure as we can on the world in the right direction. you know, i suppose the people who do more win more of my respect than the people who do less. i mean, frankly. >> do you have a fairly large body of work now, plays that you've written and things that
you've performed in. i'm wondering if you feel that any of those stand as works, that, you know, you could make the world a better place or that you feel should be more widely known or that you wish more people had seen. >> well, i mean, you know, as an individual human being, i wish people will -- more of them have been seen -- i mean to yourself, you might want to think that he could make the world a better place. i personally think that as
people are -- let's say in the united states alone. having a crisis having to do with people's head being filled with elusion. so i do think there must be thinkers and writers, and, you know, plays, books, because that might help. but it becomes ludicrous to, you know, try to judge whether your own works are valuable. i mean that -- that is something to be kept very secret for yourself. >> hi.
>> with the last chunk of the essay was the art is somewhere prothetic, and you seem to tend towards wanting to make the world a better place. as we can tell, it's -- well, you have a run out in london and a whole season in london and we don't get a chance as much though to see things here of yours. that seems to be the case of the whole slew of really great plays that would probably make a similar point or at least with in the same vein. i was wondering what your thoughts are about getting over that sort of hurdle?
whether starting in new york or regionally. >> boy, that -- i obviously have taken the coward's way out to a certain extent. if they are more interested in plays in other countries, i'm there. you know? i think it would be -- to think about how to, you know, make the theater a more worthwhile place to go in this country, that would -- i'm happy to fill os size about it. but that would take much more than the entire moments that i
have left here on earth even. [laughter] >> but i was thinking about barnes and noble alone. and it's just too -- i don't know. you know? i would have to just weighly think. it maybe this or that. it's so difficult. i think i should maybe read another piece. because it's a brutal choice. i think either i have to start and reading? else, or we have to continue this conversation which in it's own way is rather disjointed. whereas the "essay" i organizized it to -- i think i'm going to read. [laughter] [applause] >> i mean.
personally, i would hang out for longer but it's just not the way it's been organizized. so i will read. although this actually is much less -- this is actually the last one sort of went from the beginning to the end. this one is -- it's a particular moment in the past. which you could say how boring to the past? and some people would say, you know, let's leave the past behind and move forward. but i don't share that feeling. i think we must occasionally
dwell on the past. and so this is -- as i say -- this one you could really say this is not an essay. it's actually, it's from 2004. and i'm calling it fragments from a diary. that's what it is. so it's fragmentary. and if you don't think that's appropriate, you know, what can i do? [laughter] >> so this is from 2004. early september. it's tragic when civilians die in war. but is it really less tragic when soldiers die? why do people tally the death of the iraqi and afghanistan civilians but leave iraqi and afghanistan soldiers out of the
accounting. did the soldiers in those miserable armies deserve to die because they were soldiers? these were just young men. some are conscripted against their will. others decided to risk their lives and enlist, maybe because they were desperate, because they were ignorant, because they loved their country. please don't tell me they deserved to be massacred and not even counted. who does deserve to die? who's death should not be mourned? some say the guilty deserve to die and should not be mourned. we all belong to the same species. and yet, hmm, a farmer wakes up in the morning and says, i hope i can plant the seeds today before it starts to rain. and artist wakes up in the morning and says, i hope i can paint a good picture.
but those who control arsenals of weapons wake up quite differently. george bush wakes up in the morning, looks at himself in the mirror, and says i'll kill people today. osama bin laden wakes up and say, i'll kill people today. they believe they're god. that it's appropriate for them to wield power over life and death. they believe the ones they will kill are guilty of crimes and deserve to die. to bush, an afghanistan farmer who fought for the taliban is guilty of a crime. because that farmer helped to support the government of his country, which helped a man bin laden, who inspired people, who kimed -- killed americans. to bin laden, a secretary at the office of the world trade center
was guilty of a crime because she's worked for a corporation that was part of a system of international capitalism that supported a status quo in the world in which muslims are oppressed. of course, there are particular instances in which even hardened killers find it to absurd to claim their victims are guilty of crimes and deserve their death. this is particularly the case when the victims are children. in those cases, the rebels killing of child hostages, bill clinton's imposition of child-killing sanctions on iraq, the claim is simply that the absolute necessity of achieving the goal, the liberation from russian oppression, the host ill leverage that clinton wanted to apply to saddam hussein's regime
turned the killing of innocent into a tactic. a lot of hippocras comes into play. i believed in the revolution in nicaragua. i rejoiced at the end, -- if you live in a place where people are starving, where people's lives are being crushed by the status quo, you may feel the need to crush. human imagination is only capable of advicing the gandhi
approach to the ruling powers. so at times a simple choice appears to exist between the human death, daily caused by the existing system, and the use of death creating force to create change. and to denounce all of those who's battle for change has not excluded violent methods, may be to condemn most people on earth to inevitable suffocation. there may always, indeed, be a third nonviolent path. but it's usually the hardest path to see. yes, if i'm involved, i must struggle to find it. but i can't bring myself to condemn nelson mandela, and everyone else who's principal fell sort of the nonviolent ideal. nonetheless, i always come
babble to the feeling that's it's sickening for an individual to decide about himself. yes, my cause is just. and so i grant myself the power of life and death. i grant myself the right to decide who will live and who will die. i grant myself the right to kill the guilty. i grant myself the right to kill the innocent. killing other people is a terrible thing. and everybody knows it. so those who have killed are highly motivated to explain and defend what they've done. with the result for every bullet shot out into the world, you might say that a page of explanations sudden floats down into the world as well. adding to the enormous world file of explanations. many hypocritical. those who embark on a program of killing may offer explanations
using direct phrasing or indirect phrases. george bush's phrase, the war on terror, reduced bush's individual enemies to a generalized extraction. as if osama bin laden and all muslims who violently oppose the actions of the united states are so profoundly immoral and alien that they can't even be con fronted as human beings but can only be seen as a saleswoman of creatures to be exterminated. creatures who we imagine to be unable to understand human speech. creatures that communications is simply not possible. to call the concept on the war on terror is simply say, yes, it is hard to believe that any human beings could be so inhuman
has to crash planes into the world trade center. it's also hard to believe that any human beings can murder the entire families as the british did in the days of the empire. or rape and murder innocent islanders as the japanese did in world war ii or systemically, relentlily, drop explosives from airplanes on the peasant villages as the americans did in the vietnam war. the americans happened to have destroyed the city of hiroshima with an atomic bomb. so americans who tend to be shocked by the vileness by osama bin laden living in some sort of fantasy world. bin laden and his followers have a point of view for which they are being to kill. in other words, they are just like the others.
they are like us. some of what bin laden thinks is perfectly reasonable. like paul wolfowitz, like pat robertson, like ariel sharon, like george bush, bin laden thinks a lot of things that are unreasonable. bin laden is admired. some clearly admire him because of his least reasonable beliefs. many admire him because they feel there's something wrong with the circumstances in which they lief. and bin laden's anger symbolizing for them a desire for a better life. that desire is not at all unreasonable. late september, autumn begins. not unlike those unfortunate
individuals who have become addicted to pornography on the internet. a frightening number of americans seek temporary relief in nationalistic fantasy from the unsatisfying completeness of their daily lives. and then they become hooked. it's been going on for years. their dream is not about sex or pleasure. it's not even about beautiful fields or ocean waves. it's a dream about blood that flows from the wombs from the enemy nation. just as the male pornography addict identifies with and rebelled in the exploit of the triumphant naked male in the pornographic scene, the american national addict identified with the soldier, with the bomber, and above all with the president. the end of the cold war was a moment of an write for for the
american nationalism addict. pornography privileges were withdrawn. leaders sitting in a row in their uncomfortable looking uniforms and suits disappeared from the television screens, along with the trenching armies of quote, marxist guerrillas in countries around the world. just as exalcoholic are not plus or worse by the sudden disappearance of their necessary substance, nationalism addicts in the 1990s, expressed serious depression if not december per ration. but in 2001, the emergence of the terrorist finally brought relief. in fact, the terrorist were an improvement. as the russians had never
actually attacked the united states. nor had their statements expressed visceral loathing against us. one of the peculiarties of head are sexual pornography is so much of the dream is about the wonderful of the natural self as the blows are being instruct. while little is being done about the enemy. the mental camera focuses on the noble intentions and the plans of the slaughterer. while the supposedly once dangerous victim offers up blood and cries, but apparently possesses no intentions, thoughts, or feelings at all. the 18th century figures who
device the theory of modern democracy, not to mention the ancient greeked had something else in mind. the american theorist thought that citizens would live and vote based on a rationallal consideration of their own interest. a political speech might in the imagination of these practical philosophers convince the listeners to marshal of evidence and inferences. but to put a drug into someone's drink, knock them out, and carry them home is not a form of seduction. and a to paralyze a listeners brain with fantasy, whether injected by a needle through the skull or poured into the ears through the spoken word, is not a form of rational argument nor any basis for who those theorist would have called democracy.
destiny hidden inside their act of voting. it imagines a system in which smith and jones are running for office, but voters must cast their ballots only for candidate a. or candidate b. without being allowed to know which candidate is smith and which is jones, you could say, assuming the votes are honestly counted, that the voters do determine the outcome of the election, but as citizens they have no power. when they vote, they're participating in a ritual, like cow-towing before an emperor. if the americans don't know the meaning of their votes and float into the booth drugged with fantasies, their act of voting is only a ritual. apparently this doesn't bother the voters or the press or the
politicians either. newspapers and networks are commercial enterprises whose goal is to win large audiences by pleasing them and entertaining them. politicians are trying to please, trying to win votes by telling the public a flattering story about itself. they, too adopt the concerns of the professional showman whose goal is to be liked. and just like the commercial journalist, the political candidate has no desire to alienate the potentially defensive and self-protective audience by suddenly revealing that their treasured myths are nothing but lies. thus, the public can hear from the republican candidate, who believes it, and from the democratic candidate, who is consciously lying, that the vietnam war was on honorable struggle by the united states, and the terrorists attacked in
2001 because they were, quote, unquote, filled with hate for no reason at all. and so the real battles are fought between ruling elites, and the voters, the citizens, are a semiconscious prey for whoever is drugging them. this is quite dangerous for the day's citizens. this is why democracy was invented in the first place. it's very pleasant to be entertained. but if the audience isn't looking out for its own welfare, it might not survive. who will help it? who will warn it of danger? the one who provides the entertainment? unfortunately, the entertainer can't be trusted to do that. the entertainer is paid to do a different job.
of course, to tell pleasing falsehoods to a blind man or woman, in a dangerous environment, is admittedly not very nice. but the long-term welfare of the audience is just not the entertainer's concern. [applause] >> so, five more minuteses of thoughts? >> sure. >> i think america has found its new emerson. i'm an essayist myself, and a
person who teaches writing to students who do not want to writees says. i want to thank you for breathing new life into the essay form, which seems particularly suited to expressing complex thought and being honest, the kind of stuff you're known for since "my dish with andre," and i hope you will continue to write more essays, and i think america needs more of wallace shawn. have a tv show would be good. >> i really don't know what to say. essays are wonderful form. absolutely. does anyone else --
>> you wrote it before an election that had different results than you were originally writing out, has your perception of the vote changed in a different way that some would think was better than the 2000 election? >> well, i'm not committing myself to saying that an election is inevitably nothing but a ritual or the 2004 election was nothing but a ritual. i was more saying that if people don't know what they're voting for, then it is a ritual. to the extent they don't know, it is a ritual. and, you know, the 2008 election
, we're going to judge that in a few years. obviously obama infinitely more appealing or attractive candidate than we have previously been offered. but obviously we will learn over the course of time if -- you know, did the people who voted for him know what he would do? did they know what he was even like? did they know what he would like to do? those are two separate questions of course, he didn't know what he would be able to do. probably he had some greater sense of what he would like than
we have. and maybe it will turn out that we'll say, yeah, the guy that i voted for was the guy who i thought i was voting for. then you would say, well, democracy in action. [laughing] >> in the back. >> i notice in the flier you did a translation of aend opera, and i was wondering. it's been done a couple times as we know. i wondered what you found you could add to it. do you speak german? >> when i grew up on the upper east side, i went to schools that provided self-esteem, you
know, whether we learned anything or not, the principle goal was that you learn self-esteem, so i have spent a few months in germany. i studied latin. i know english. i have a large german dictionary, and that training in self-esteem was the principle ingredient in my translation. [laughing] >> and then i checked it out with people for whom german is actually their first language, and, you know, i fixed it. [laughing] >> but, you know, it didn't have
that many ludicrous -- i mean, there were ludicrous things, you know. but -- yes, i mean, it's -- translating -- i highly recommend it. it's really an incredible way to come to understand a writer's work. it's fantastic. we really should, i suppose -- i'm not that busy, but i suppose there are ways that -- i mean, should we -- what should we do? we should -- friends, this is it. [applause] >> okay. thank you. [applause] >> playwright and actor, wallace
shawn has appeared in the movie "princess bride." and wrote and was in "any dinner with andre." >> bruce bartlett appeared on c-span's washington journal to discuss his new book, the new american economy. the former reagan economic advisor says the government needs to raise taxes in order to stop the growth of our ever-expanding debt. the program is 45 minutes. >> we're joined by bruce bartlett, his new book, "the new american economy." you call yourself a supply-side or former supply-cider. what is supply-side economics.
>> guest: it's a euphemism for an economic viewpoint that developed in the late 1970s where we had a problem of stag nation, rising unemployment and rising inflation, and the existing freestyle, economic freestyle was based on the theirs of john may understand canes which had been developed in the 1930s. those policies presupposed a deflation near situation so when you use them in an inflationary situation, all they did was make inflation worse, and the inflation eventually made the unemployment worse. so, the supply-ciders look around for a different way, and their philosophy was to tighten the money supply that -- severely to reduce inflation, and at the same time cut tax rates in order to increase the incentive to work, save and invest, and almost all conventional economists, thought
this was insane. it was like putting your foot on the brake and on the gas pedal at the same time, but we thought it would work, and it did work because ronald reagan and paul vocker implemented it, and by the meddle of the 1980s, inflation was down substantially and growth had been restored, and this was viewed as a success with a supply-side model. >> host: how difficult was it for you to write a book about its failure? >> guest: the problem is that the reason why the economics wasn't working in the 1970s is because it was misapplied in inappropriate circumstances. i think the same thing happened with supply-side economics in the 2000s. a lot of policies immigrant pled -- implemented by the george w. bush administration was supposed to by supply-side economics about they were not. they were making ridiculous
claims and implementing unwise policies they said were based on supply-side economics and they weren't. i think the we had developed from that misunderstanding. >> i want to follow up on that point. you write about what remains when people think of supply-ciders is a character, there's no problem that more and bigger tax cuts won't solve. talk radio and group sessions, club for growth, and americans for tax reform, ruthless the enforce this, even know it's obvious that the tax cuts of the george w. bush years were not especially successful, that economy's problems today are due to lack of demand and not supply. why did the bush administration, in you viewer, get it wrong, -- reaganolics. >> guest: the president's father raised taxes in 1990, and he was very widely criticized, and it led to his defeat in 1992.
and i think that his son was never going to make that same mistake. i think he felt as long as he kept cutting taxes and cutting taxes and cutting taxes, that a largelet of the republican coalition would be with him, and no matter what else he did. and i think that as a political calculation, that worked. the problem was it was irresponsible, as was much of the policies of the george w. bush administration. i -- just for example, i'm incredulous, but so many republicans are complaining about the cost of the health care measure that is being considered, that at least is being paid for in one way or another. whereas they put forward a proposal to expand drug benefits for people on meds -- meds care and didn't pay for it at all. it has cost like a trillion dollars over the next ten years, the medicare drug benefit law, which is about the cost of the
health benefit. so these people have no credibility whatsoever. >> host: your book is about the failure of supply-side economics, it starts with a look back at fdr. why did you start there? >> guest: my basic idea was that it observed that supply-side economics had gone through a cycle where there was a real problem that the existing orthodoxy couldn't handle. the new philosophy came into existence, was implement, appeared to be successful and it was applied in every circumstance whether it was successful or not. so it was cycle of success and failure. and realize the canessan economics went through the same cycle. it was imcomplemented in the 1930s, helped end the great decision, and then misapplied in
the 1950s and 60s and gave us inflation. so there was a symmetry that was interesting, and then i tried to ask, well, what's going to come next? >> host: that's where i'm going to ask you, what comes next? have we come full circle to an kensyaan economics. >> guest: as i was finishing the book as the economic crisis hit, and it was quite clear to me that the economic conditions we're viewing were almost identical to the canes analyzed in the 1930s. so it was a useful exercise for me to have that background just as this happened, but i had to short, circuit my thoughts about what was going to come next because i was overwhelmed by the economic crisis. >> host: when folks talk about that, they talk about more spending. correct?
>> guest: to me the essential point -- you have to understand that what runs the macro economy is essentially federal reserve policy. monetary policy, but there are times when fed policy is impotent, when it can't do anything. the economists say it's pushing on a string. these conditions come about when you have very, very low interest rates as we have right now. an economist calls this a liquidity trap, and then the fed is unable by itself to stimulate the -- >> so keeping rates isn't going to do it? >> guest: you have to have some engine pull the economy along, and that engine has been fiscal policy, that is, government spending. and a lot of people think that, if you're going to do something on fiscal policy, just cut taxes. but the problem is that tax cuts i don't think will have any
impact in our circumstances right now, and it's a mistake to heave one size fits all policy that worked under different circumstances, and to say let's do it again under different circumstances. seems the canessan model fits the circumstances. >> host: so fiscal stimulus was mess? >> guest: i did support the idea, but i warned at the time that it was being grossly oversold, which it clearly was. unemployment is vastly higher than he administration had predicted. and i also think that the people miss -- don't understand the time lags involved. it was clear to me that it was going to take much, much longer than the administration thought before the spending actually impacted on the economy. and i think that's one reason why the unemployment rate has not fallen -- why it's risen and
not responsibilitied. >> host: we have callers waiting. first up on our republican line. >> caller: i want to get ahold of the back and -- of the book and read and it get more insight. i want to address, if we're dealing with fiat currency, how can you stop inflation? if so-called money -- if the currency we're using is not backed by anything, what can we do to stop the inflation? what happens when your money is not backed by gold or taken off the gold standard like the house joint resolution -- >> host: that is corrects. let's get a response.
>> guest: it's clearly the responsibility of the federal reserve to maintain a stable price level, and although they have increased the money supply a great deal in response to the current economic crisis, the fed perfectly well understands that it has to reverse that policy or else we're going to be back into a 1970s hyperinflation situation, and they have already talked a lot about how to do this and when to do this, but they have not yet decided to actually begin tightening, and my fear is that they will wait too long and so i think a certain amount of inflation is almost inevitable, but hopefully the fed will not allow it to go too far. >> host: next is erie, pennsylvania, good morning, a democratic caller. go ahead. >> blairstown, new jersey, independent line. >> caller: good morning. mine is a theory, and i think
all these people all got it wrong and try to push the democratic way and push the republican plan. the only plan that needs to happen is they're playing games with the fed. they got to start placing the val knew america again. you look at the from illegal immigration, devaluing construction workers. we got to start being americans again and putting val knew america again. you guys can do what you want, but the democrats are selling us out into socialism, and the republicans are robbing for the rich. >> host: what been the impact of jobs going overseas. >> guest: there hasn't been a lot of that. there's lot of evidence that a lot of illegal illens would come though country previously are now in fact leaving and going back home. i guess on the theory if you're unemployed you might as well be unemployed in mexico as guatemala as be unemployed in california. but i don't think that that
perspective is very useful in terms of trying to get the economy moving again because it's clear that our basic problems are macroeconomic. they're things we have to deal with in terms of what goes on at the capital, in terms terms of stimulus spending, and mostly in terms of what goes on at the federal reserve, and you kind of lose your perspective and start focusing on individual trees and miss the forest, which is really what we have to think about. >> host: you write about fiscal stimulus in. you said the ink was barely dry...
>> host: there is any evidence that this sort of experience may happen with the stimulus bill? >> guest: it clearly did. a go deal of the money in the february stimulus package was just pork barrel stuff and things that members of congress have been wanting to get past and just needed some excuse, some must-pass legislation to get enacted. but one of the things i talk a lot about in the book is something i mentioned earlier, which is the implementation lag. there was this somewhat romantic notion that there were just tons and tons of public works projects that really needed to be done, roads to build and bridges to build and things like that, and the plans were just sitting there, and everybody was just ready to go, and all we needed was a check from the federal government, and the next day workers would be out digging and building, and that wasn't true. it takes a long time to get
these projects going, and the last time checked the data, in august, only $16 billion out of all of the almost 800 billion in the stimulus package actually had gone to public works projects that had been -- were already working. that's a very trivial amount of money, and a lot of the rest of the money was just wasted. >> host: you're critical of the tax rebate that happened at the very end of the george w. bush administration. not very effective? >> guest: not at all. a lot of history on this. we trade a tax rebate in 1974, and all of the studies showed that people didn't spend it but just saved it, which may sound like, well, saving is good, too. but the deficit increased in order to pay out the deficit -- or the rebate. so, the higher deficit simply offset dollar for dollar the rebate and nothing real was accomplished in terms of
stimulating growth. and we did not rebate in 2001, and all the studies showed exactly the same thing, and despite all these failures, we had another rebate in 2008 that the same thing happened. and i argued at the time -- i wrote a piece in "the new york times" that says this money is being wasted and we should use to it stablize the housing market. maybe a little money upfront could have forestalled a collapse that cost more to take care of later on -- >> money to homeowners and such? >> guest: i wasn't the right way to use the money. my thought, give it to freddie mac and fannie mae and buy up the bad paper. the point is it's an option that was never considered so we will know over in what could have been done differently. the rebate didn't work at all. >> host: we next go to erie,
sorry re missed you. you're on now. >> caller: mr. bartlett, you just mentioned bad paper. it really strikes me as sort of disingenuous of the right and the consecutives -- conservatives to complain about the deficit the problems the government is going through right now with financing all these things. when you compare the deficit the federal government has with the obligations that business has due to all that bad paper, all the debt that they created, this the trillions of dollars -- credit default swap is like $43 trillion? it's unbelievable, the insurance that business took out on itself against its bad decisions, and now all of that is coming due. when you compare -- can you compare the federal deficit versus the deficit of the big mistakes everybody made or illegalities that people made. i will get my answers off the
tv. thank you for having my question. >> host: thank you. >> guest: well, i was a little unclear as to what the caller was asking. but i certainly agree with one thing you mentioned at the beginning, which the republicans have really -- on the wrong track trying to blame every single thing going on with obama. i mean, to listen to these guys, you would think the budget would be balanced if we elected john mccain. i think it's important to remember the cbo deficit for 2009 that was made in january 2009 before obama took office was $1.2 trillion for fiscal year 2009, and at the end it was 1.4 trillion, and 100 billion of that was due to slower economic growth than the cbo anticipated, leading to lower revenues.
so there was exactly $100 billion of spending that was not projected in january, and i think it's worth keeping that in mind because it shows really that the administration has done very, very little in terms of stimulus for the economy, and a great deal of the deficit problem that the republicans complain about is because of their policies which obama inherited. >> host: san francisco, good morning, susan, democratic caller. >> caller: i have sort of a specific question. i can't figure out when i try and think about where the mortgages -- who lent what money to who -- and that is that on the one hand i have heard people say that one of the things that pushed people to make these -- all these loans is that there was such a market for asset-based investments. so, these mortgages were turned
around and then people bought them as investments, i guess presumably because they pay interest back and they would make a profit. and that wall street, you know, was just turning these over so fast that people were looking to make more and more mortgage loans. on the other hand, when the banks had problems, one of the things they said they're broke because all these foreclosed homes, and the decreasing prices that homes cost, which are i guess the toxic assets on their books. they have all these losses. they seem to contradict each other. it would seem they had already turned these mortgages around and then paid for them by the investors. it seems to contradict itself. >> host: thank you, susan. >> guest: well, historically, banks would make a loan to a
homeowner to buy a house that would give them a mortgage, and the bank would hold though -- the mortgage until it was paid off. over the years people concluded you could take mortgages sitting in these various banks and bundle them together and have a new type of investment vehicle that people were willing to buy because you can get a higher interest rate on mortgages than you can on many other kinds of investments, and in theory, these were all backed by real estate, and so, therefore, you had at least in theory very low risk. and so for a long time it was good deal because the banks in the past, when they would make a mortgage, they might not have any more money available to make additional mortgages, but now they can sell the mortgage and get money back that they can then relend to someone else. so, for a long time, it was really a good deal. the problem was that the
people -- the real problem was the people whose job it was, places like moodies and standard and poors to go housethrough these packages of mortgages and then try to figure out what is the risk in this -- in these mortgages, the likelihood that some percentage of them are going to go bad, and they did a very, very poor job of making those estimates. and we also had some just unexpected events that just -- it was good idea but just didn't work. >> host: you raised a red warning flag in your book about a second fiscal crisis. when this second fiscal crisis hits in the next few years it is inevitable that higher revenues will be needed to plug the miss school hole. unfortunately both pareds are in denial. the republicans still delewd
them that tax cuts starve the beast and increases feed it. and democrats simply refuse to acknowledge reality. what is the second fiscal crisis you're talking about? >> guest: well, i started writing this book long before the current fiscal crisis and before the massive deficits we have seen, and i was looking at the projection from last year and earlier made by the congressional budget office and government accounting office and places like that of the long-term fiscal trends and what is going to happen to programs like social security and medicare and medicaid when the giant baby-boom generation begins to retire, and the youngest one has already turned 62 and qualifies for early retirement, and over the next few years, more and more of my generation are going to be drawing social security and medicare. and when that happens, the spending for those programs is
going explode. and we have done nothing, absolutely nothing, to reform them in such a way as to make them sustainable, and i'm afraid that as time goes by, we're -- the deficits we're looking at now think are one-time only events are liable to become regular events that will have a very negative consequence for interest rates and inflation, and at some point we're going to have to do something about it. i think doing something sooner is going to be a lot less painful than waiting until the last possible moment. >> host: one of your solutions is a value-add tax. >> guest: my observation of the analysis of the situation is that it's simply impossible, certainly unlikely in the extreme, that we can cut enough spending out of entitlement
programs to avoid the necessity of large tax increases. the question becomes how to raise the taxes. if we try to get more revenue out of our income tax system which is barely functional, i think it will collapse of its own weight, and we have to look at a new revenue sores, and this value-added tax is something every a major done country use, and it's a kind of sales tax, and instead of being collected at the check you it's collected in the whole production distribution stream, and it's proven in other countries to be a very, very effective tax, raises a lot of revenue at very little economic distortion, and i think we have to do it whether we like it or not. >> host: many supporter0s -- supporter0s of that oning capital hill? >> guest: none.
i hear members say, i'm absolutely right, but if you go around and say i agreed with you i'll call you a liar to your face. so there's a deep, deep fear about saying anything about these things that i think is very version harmful because we need to at least have open debate and not have certain subjects that we're not allowed to discuss because it upsets somebody. i think the policy community in the city has really fallen down on the job by pandering to crackpot ideas like, you know, all tax cuts raise revenue and silly things like that. or that tax cuts will starve the beast and - >> host: what does that term mean, starve the beast? >> guest: the idea was that if you try to cut spending you'll never get anywhere because the people who like spending are too powerful. so the trick was, let's cut
spending and not worry about spending, and when the revenues are reduced and the deficit is increased, then all the people who worry about deficits will have no choice except to put their efforts into cutting spending. and that was a theory that made a certain amount of sense in then 1970s, but clearly makes no sense whatsoever today. there's simply no evidence that that theory works, and yet a lot of people on the republican side are absolutely convinced that this is the key to financial bliss or whatever. it's just stupid, really. >> host: robert, next, maryland. good morning go ahead. >> caller: hi there. since jobs are the big issue, what would be the problem with a tax cut on businesses, like richardson has been talking about. knocking down the corporate tax
as low as any other country in the world, eliminating capital gains taxes, and at least eliminating for a while the payroll taxes, and businesses would move back into the country who have left, and then of course avoid the upcoming cap and trade, which was really making it kind of tough for businesses. what do you think about that as an alternative to stimulate and get jobs back? >> guest: well, i don't think any of those proposals will work because i think the basic problem we have in our economy today isn't that costs are rising, but, rather, there's no demand. most companies -- great many companies are losing money. a tax cut is not going to do them any good. what they really need is an increase in people buying their products. and i don't see how tax cuts on
business are going to do any good. don't see how any tax cuts are going to do any good under current economic circumstances. in the fiscal year that just ended, 2009, federal revenues were 14.9% of gdp. the lowest level since 1950. the historical post war level of taxes is 18% of gdp. so we have already had a 3% point cut in taxes as share of gdp that has clearly not done any good to revive the economy. just throwing more tax cuts out there that have -- we have no reason whatsoever to think will have any impact. just dog dogma. doesn't have any relationship to reality. >> host: 15 more minutes with bruce bartlett. next up is detroit. john on our republican line. >> caller: good more than,
mr. bartlett. infrastructure is something that it can't quite understand -- i can't wrap my mind around why people seem to oppose or think that it's going to go poorly. we have been talking for years now -- i'm a construction civil engineer, and we have been talking about the deficiencies of the faa and the tracking of aircraft flight in this country. we have been talking about bridges that -- here in detroit we just found out recently that m-dot found out there's a number of over the water bridges we have not been looked at as they were supposed to be, and the bridge at goes over to winsor -- maybe you heard about that -- but it's in some questionable state. and i looked at the number of bridges in this country, and i believe it's in the -- over 500,000, and you would think that if we only were to look at
those bridges and investigate as to what state of -- state they're in, except for the ones receiving routine maintenance -- just the bridges alone, if you were to initiate engineering contracts to have them investigated and looked at, that's going to more than -- would have to spread out into heavy equipment and other contracts, which would lead to suppliers. maybe that's simplistic, but seems to be that would be the case, and also separating sewer systems, improving waste treatments and water treatment plans and all the things near this country -- if we can put that much money into iraq -- ex something out of it. >> host: i will add a twitter:
>> host: calling for government spending in the instruction -- infrastructure area, and you get back though problem of the mounting debt. >> guest: it's kind of short run-long run problem. right at the moment the problem is we have to stimulate growth and increase jobs. and i think the caller is exactly right that there's a great deal that could have been done in terms of public works spending that was clearly a great need to fix up the bridges and roads and things like that. my only point that i was making is that people ginned estimate the time lag, the time it takes to have plans drawn up and things of this sort before meaningful work is being done by people in the construction industry. and that's being done. it's just been done much more slowly than people thought was necessary.
they had this motion, liked said earlier, that all you needed was to have a check and the next day people would be out, you know, with pick axes and things, and it doesn't work like that. it's a long, drawnout process. but going forward i'm optimistic economically because i think a lot of the money that was appropriated back in february will be still coming online this year, and will add some stimulus to growth. >> host: why did the stimulus work during the fdr years it's slow to work now? >> guest: it didn't really work at all during the fdr years. that's the whole problem. the right-wingers are complaining about how big roosevelts deficits were, but the problem is they weren't big enough, and at the point at which the deficits were starting to have a good impact, roosevelt goss talked into balancing the -- got talked into balancing the budget, and the federal budget went from a deficit of
5-1/2% of gdp to a complete balanced budget in fiscal year 1938. so took 5-1/2 percent of gdp out of the economy, and its wasn't until world war ii that the depression really ended. >> host: to mess sarks arizona, good morning, andy on our democratic line. >> caller: good morning. i'm looking at the kind of economist that the republicans in washington and groups like the united states chamber of commerce are trotting out and supporting their tax cuts and trying to say tax cuts create jobs, and i have never seen any evidence of that in any lifetime. i'm also wondering what you think about increasing stimulus and actually going out and spend mortgage money to try to create some more demand out there?
>> guest: i think it would probably not be a good idea to have a second stimulus package. there's evidence that be turned the corner and passed the bottom. and in terms of gdp things are turning upwards, and the stock market's rise is evidence of that. and you have a growing number on economists predicting a v-shaped recovery, which would be quite a rapid increase, and any number of economists are predicting 4% growth next year and things of that sort. the problem is that there's a disconnect between gdp and jobs. we used to know that if gdp went up x percent, you would gets' other percentage increase in the number of jobs.
they tended to move together. now it appears they're not. instead, what businesses are doing is they're investing heavily in labor-saving equipment, doing whatever they can to get by with their existing labor force, and avoiding at all costs hiring new workers and that's more what economists call a microeconomic problem. but i think we have to come up with creative solutions for dealing with that -- because that's a problem threat going to be there, even when we reach the point where gdp growth is at the point where we all agree the recession is over with. >> host: how would you advise president obama on the unemployment problem? >> guest: boy, that's a very tough nut to crack. there's a lot of talk these days about some sort of tax credit for newly hired workers. >> host: goss to businesses.
>> guest: it's hard to tell who is a new worker so you have a tendencies to give rewards to businesses that just happened to be expanding for whatever reason, and you get people gaming the system, you lay off some guy one day and then you hire the same guy back the next day and get a tax credit. these kinds of things have made it very hard. we tried this sort of thing in the past and didn't work very well. we're probably going to have to come up with a package of things. i think it was very bad idea to raise the minimum wage in july. it's quite clear that you had an almost instantaneous increase in the number of teenagers who were unemployed. we have to be more creative and i haven't really heard any real good ideas in that area. >> host: lansing, michigan, is with us, this is keith, good morning. independent line. >> caller: i just want to say john maynard canes discredites himself because he endorsed the nazi economic policy. >> guest: that's not true.
just not true. >> listen to what i'm telling you. john may nord canes said while he was trying to figure out the problems of unemployment, adolph hitler sod it. so we all know how the nazis economic policy ended. but our economy is so centralized, it's centralized and the politicians have made it to where we're going to have a service economy instead of an industrial economy, and you can see our tax code is set up to penalize industry. so what they want to us do is fix the products that china and other countries make while we are just not making anything. if we don't start back in an industrial society and get all these whack oenvironmentallists out of the way, we're going to be really hurt. >> host: keith, a response. >> guest: i think it's clear that a lot of countries in the 1930s were experimenting with what we came to call canessan
ideas, government spending, public works, and the germans were among them, this sweeds -- swedes as well and its irresponsible to make the claim that canes was a nazi because countries implemented his policies. as far as china is concerned, the real problem has nothing to do with taxes and has everything to do with the exchange rate they simply refuse allow the currency to rise, which gives them a competitive advantage that makes it cheap are for us to buy goods from them than to produce them ourselves. nevertheless, the u.s. is still the largest manufacturing country in the world and the largest exporter, and i think sometimes we forget that and run ourselves down whenually we're still in pretty good shine. >> host: a story this wmoiner
philadelphia inquirer. what are the challenges of a country like china going into africa where the u.s. is already but coin becomes a competitive in those countries? >> guest: i think it's basically in everybody's interests to see africa more developed, and the chinese view africa as an untapped resource for raw materials they need to fuel their manufacturing sector. and so i think it's a challenge, but i don't think it's a problem. i think it's really -- makes a lot of sense for everybody. >> host: kirby, georgia, on or republican line. >> caller: hi. i wonder if our guest has ever read economics -- basic economics by -- as far as i'm concerned the federal reserve is canessan, and the thing he
criticized about the drug bill, that's canesian, and i would like to ask a question, does he think economics is an or the or science in i think it's a science, the same way the corps of engineers can determine how water will flow when they determine where to put a dam, human nature is the absolute that can be used to determine what economics is. >> host: in all your years of economics, have you figure out whether it's an art or science. >> guest: it's more an arts than science. it's not very scientific at all except in its superstructure. you have mathmatics that looks scientist but when you peel away the layers, it's a judgment call. people make theoryies fit for whatever they believe in. and they cook up theories that
support where they're already coming from. but i certainly don't think that i'm naive or knee-jerk free market point of view such as tom soil or walter williams tells us very much useful, if anything, at this moment in time. >> host: how much is your new book a folp your previous book, how george w. bush bankrupted america? >> guest: it's a bit of a followup. that was more narrowly focused, but there was a lot in there that got me think can about these issues, like we weed a tall these tax cuts in the 2000s and didn't do any good at all. and i think it's because they were misdesigned and for partisan reasons people talked themselfs into believing that tax credits, the same thing as government spending, where are somehow or other different and it was okay to have tax credits
and not have tax rate reductions, and they just talked themselves into believing that whatever the white house wanted was good for the economy, and it was just all -- you know, i'd say --d but we're on tv. >> one more e-mail for you. >> guest: it's a tax on sales, on consumption, and ideally you want it to be as broad as possible to include services as well as manufacturing. one of the virtues of the v.a. t. it applies equally to imports and was rebated at the border on exports. so, actually, it gives you a benefit in terms of international trade. so, it's really a very good tax from a narrow technical point of
view, and the people who oppose it are just dogmatic and don't know what they're talk about in most cases. >> host: one more call. st. louis good morning to william. >> caller: first off, fine it hard to believe that most people say that tax rebates, the last time we had it -- i don't know how many people that would save the tax rebate would be the wealthy. the other thing wanted to mention was that do people really believe this economic problem that we have at the present time can be solved in nine months? and the third question or the last question was, the stimulus supposed to stop or was -- was that supposed to make things better over a period of time?
let's say four years of the obama administration? >> host: thank you, william. >> guest: it is true that the wealthy were certainly much more likely to save their rebates than the poor, and some 30% or so of the rebate was in fact spent. the point is that it was very poorly targeted. the money went to everybody, perhaps if they had had some more targeted sort of rebate that went to the poor to people who are living from hand to mouth, that they would have been forced to go out and spend more money, but you probably couldn't have passed something like that through the congress. the main thing to me is that the republicans are just so dogmatic about tax cuts, that they support anything that they call a tax cut, and a tax rebate is actually money, check they mailed out. so, i don't really see how that has nothing do with taxes.
certainly i think the administration was expecting to see some impact or some more impact from the stimulus than they have seen. i think they always understood it was going to take years before we got back to where we were before the recession. i don't remember what his last question was. >> host: he asked about tax rebates, and you addressed that. and talk about bad mortgages. bruce bartlett, thanks for new n economy. " thanks for being with us. in-flsh. >> bruce bart lt. is the author of impostor, how george w. bush bankru reagan legacy.
>> coming up next, book tv presents, after word, an hour-lon interview program where we invite a guest host to interview the author of a new book. this week, historian thomas fleming profiles the women who played a central partner lives of the founding fathers. in his book, "the book, the intimate lives of the founding partners" to the prominent role that dolly madison employed in encouraging her husband james. e book with barbara mitnick. [applause] >> host: first of all, i want to say what a delight it is to be here this evening with tom fledge
fledge -- fleming who needs hardly an introduction, he has authored more than 40 books. he is to me and to many americans america's greatest story telar, particularly of history. he has been enormously successful, a win over major awards for his back and his lifetime devotion to american history. i think we could spend the entire evening here, all the time we have allotted to us, just reviewing the numerous books and aurals that tom has written, works on franklin, washington, jefferson, truman, fdr, american wars, the hamilton-bird dual, the outstanding view he produced to a company the major 1997pbs production "liberty." the recent perils of peace which
deals with the events after the surrender of the british in youtown. a memoir of your upbringing in jersey city, where i'm front. and more on the american revolution, the leadership of george washington, and now the subject of tonight0s conversation, the role of women in american history. we see this in the fiction and nonfiction that you have produced over the years in novels, such as liberty tavern, which came out in 1977. the difficulties in that book involving women, life during the american revolution. the officers wives that came out in 1981, about three west pointers and their wives to paraphrase, about the resignation of these oer